Suppose Kenji is willing to pay a total of $180,000 for an antique car. True or False: Keeping his maximum willingness to pay for an antique car in mind, Kenji will buy the antique car because it would be worth more to him than its market price of $225,000
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- What is the relationship between total surplus and economic efficiency?4. Consumer surplus for an individual and a market The following graph shows Becky's weekly demand for cheesecake, represented by the blue line. Point A represents a point along her weekly demand curve. The market price of cheesecake is $3.00 per slice, as shown by the horizontal black line. PRICE (Dollars per slice) 7.50 6.75 6.00 + 5.25 Demand 4.50 + 3.75 3.00 2.25 + 1.50 + 0.75 + 0 0 Price 2 Becky's Weekly Demand P 4 6 8 10 12 14 QUANTITY (Slices of cheesecake) 16 18 20 ? From the previous graph, you can tell that Becky is willing to pay for her 8th slice of cheesecake each week. Because she has to pay only $3.00 per slice, the consumer surplus she gains from the 8th slice of cheesecake is $ Suppose the price of cheesecake were to fall to $2.25 per slice. At this lower price, Becky would receive a consumer surplus of S 8th slice of cheesecake she buys. from the2. Individual demand and consumer surplus Consider the market for apartments. The market price of each apartment is $300,000, and each buyer demands no more than one apartment. Suppose that Tim is the only consumer in the apartment market. His willingness to pay for an apartment is $480,000. Based on Tim's willingness to pay, the following graph shows his demand curve for apartments. Shade the area representing Tim's consumer surplus using the green rectangle (triangle symbols). PRICE (Thousands of dollars) 400 420 360 300 240 180 120 60 0 Tim's Demand QUANTITY (Apartments) Market Price Tim's Consumer Surpis ?
- 1. It is a hot day, and Seth is thirsty. Here is the value he places on each bottle of water. Value of first bottle P7 Value of second bottle P5 Value of third bottle P3 Value of fourth bottle P1 a. Form this information, derive Seth's demand schedule. Graph his demand curve for bottled water. b. If the price of a bottle of water is P4, how many bottles does Seth buy? How much consumer surplus does Seth get from his purchase? Show Seth's consumer surplus in your graph. c. If the price falls to P2, how does Seth's consumer surplus change? Show these changes in your graph.1. Determine the amount of consumer surplus generated in each of the following situations William goes to the clothing store to buy a new T-shirt, for which he is willing to pay up to $10. He picks out one he likes with a price tag of exactly $10. At the cash register, he is told that his T-shirt is on sale for half the posted price. b. Sophia goes to the CD store hoping to find a used copy of the Eagles Greatest Hits for up to $10. The store has one copy selling for $10 c. After baseball practice, Nicholas is willing to pay $2 for a bottle of mineral water. The 7-Eleven sells mineral water for $2.25 a bottle. а.CENGAGE MINDTAP Aplia Homework: Chapter 7 PRICE (Dollars per slice) 7.50 6.75 6.00 5.25 4.50 3.75 The following graph shows Amy's weekly demand for cheesecake, represented by the blue line. Point A represents a point along her weekly demand curve. The market price of cheesecake is $3.00 per slice, as shown by the horizontal black line. 3.00 2.25 1.50 0.75 Cengage Learning Demand Price BO Amy's Weekly Demand 30 26 A O 0 280 Help NOV OOO ng.cengage.com Mind Tap Cengage Learning ? tv C ♫ NA Q Search this course ? D a g W (1) WhatsApp Wed Nov DOCX Am
- The graph below depicts Jacques monthly demand for tuna. Suppose the price of tuna falls from $12 per pound to $8 per pound. On the diagram, use the area drawing tool to box in the change in Jacques's consumer surplus. And what is Jacques's consumer surplus increase by $2. Individual demand and consumer surplus Consider the market for electric vehicles. The market price of each electric vehicle is $135,000, and each consumer demands no more than one electric vehicle. Suppose that Tim is the only consumer in the electric vehicle market. Their willingness to pay for an electric vehicle is $270,000. Based on Tim's willingness to pay, the following graph shows his demand curve for electric vehicles. Shade the area representing Tim's consumer surplus using the green rectangle (triangle symbols). PRICE (Thousands of dollars) 360 t 315 PRICE (Thousands of dollars) 270 225 100 135 12 Homework (Ch 07) Now, suppose another buyer, Alyssa, enters the market for electric vehicles, and her willingness to pay is $180,000. 300 Based on Alyssa's and Tim's respective willingness to pay, plot the market demand curve on the following graph using the blue points (circle symbol). Next, shade Tim's consumer surplus using the green rectangle (triangle symbols), and shade…1. Determine the amount of consumer surplus generated in each of the following situations a. William goes to the clothing store to buy a new T-shirt, for which he is willing to pay up to $10. He picks out one he likes with a price tag of exactly $10. At the cash register, he is told that his T-shirt is on sale for half the posted price. b. Sophia goes to the CD store hoping to find a used copy of the Eagles Greatest Hits for up to $10. The store has one copy selling for $10 c. After baseball practice, Nicholas is willing to pay $2 for a bottle of mineral water. The 7-Eleven sells mineral water for $2.25 a bottle.
- Suppose Yvette just sat down to enjoy the Double Stack burger that she purchased for $1.00. Her friend, Sean, would also like a Double Stack burger, but he strongly dislikes standing in line. Sean offers to buy Yvette's Double Stack rather than wait in line himself and pay $1.00. The following table shows some hypothetical offers Sean might make for Yvette's burger. First, compute the consumer surplus Yvette gets from buying the burger for $1.00, refusing Sean's offers, and eating the burger. Enter these amounts in the second column of the following table. Next, compute the consumer surplus she gets from buying the first burger at $1.00, selling it to Sean at each price listed, purchasing another burger for $1.00, and consuming it. Enter these amounts in the third column of the table. Again, assume that Yvette's cost of waiting in line for a burger is zero. Note: If Yvette is willing to sell her burger to Sean while at the Wendy's restaurant, she would purchase another burger…Suppose that Michelle buys a cappuccino from Paul's Cafe and Bakery for $5.75$5.75. Michelle was willing to pay up to $7.75$7.75 for the cappuccino, and Paul's Cafe and Bakery was willing to accept $2.25$2.25 for the cappuccino. Based on this information, answer the following questions. Michelle's consumer surplus: $ Paul's Cafe and Bakery's producer surplus: $only typed answer A consumer has inverse demand of p=15−1q for a good and the market price is $4.00. Calculate consumer surplus and the total value of the good for the corresponding quantity consumed. Consumer surplus is $enter your response here. (Enter your response rounded to two decimal places.) The consumer's expenditure for the good is $enter your response here. (Enter your response rounded to two decimal places.)